MOF’s New Target

There appeared an unusual argument over military budget between the Ministry of Finance and Defense. MOF asked to abolish the appendix list of military procurement in new National Defense Program Guidelines starting next fiscal year. Although it supposedly has various reasons for MOF to get started complaining to traditional way of procurement, its main purpose would be to maintain its hegemonic power in the government. Its biggest enemy in this issue is a group of lawmakers involved in security policies in the Liberal Democratic Party.

The appendix list is made for determine how many and what kind of procurement will be needed in next decade. In former guidelines, the list included the number of divisions and battalions, or tanks and artilleries for the army. Approximate needs for submarines, fighter jets or anti-ballistic missiles are also determined in it. The new guidelines will be delivered before the end of FY2013.

MOF openly challenged this way of procurement. MOF Budget Bureau announced that the reform of procurement and personnel management was needed for MOD. Putting priority on rebuilding fiscal structure and regain international credit on Japan, MOF has been very sensitive to the swelling military budget. Military procurement is a soft target, because it has been criticized to be full of irrelevant usage of money, tainted by a number of scandals by politicians and military brokers.

Reforming the practice of MOD can demonstrate the overwhelming power of MOF in the bureaucratic community. After the defeat in World War II, Japan had been reduced the power of military in the government. Imperial Army was reformed to Self-defense Force, and civilian control over uniformed personnel was reinforced. In post-war Japan, budgetary power overtook military power in the government. The most brilliant college students were recruited to MOF. So, current tendency of expanding the role of MOD in Abe administration must be inconvenient for MOF in terms of maintaining its top status in the government.

It is unlikely for PM Abe to restrict the action of MOF, because he needs help of MOF to implement his appealing economic policy. Rebalancing the fiscal structure is the key for Japan to get rid of long time slump. But his right-wing supporters in LDP are not silent to MOF. “We should not be giving in,” said Takeshi Iwaya, the chairman of Security Research Group of LDP. They are keeping anxiety over the expansion of Chinese military power.

Offering Favors

Shinzo Abe stressed strong Japan, while Manmohan Singh just kept his smile. The Prime Ministers of Japan and India had a meeting in Tokyo on Wednesday. Restricted in developing new nuclear plants in Japan, Abe expect Indian market to buy Japan-made nuclear plants. Singh looked like having superior position, in which he could compare all options offered by countries. Making contrast to Singh with nothing to lose, Abe’s seriousness for the achievement was outstanding.

Both premiers agreed with having an atomic agreement as soon as possible. The government of India has a plan to build eighteen nuclear plants by 2020. Calculating the price of one reactor as $5 billions, Japan was joining the competition among US, France or Russia with establishing joint team of public and private sectors. Looking at other competing markets, including Saudi Arabia, Vietnam, or Poland, the success in India will have a great significance for Japan business, and growth strategy of Abe.

However, nuclear deal with India has some negative elements. On the top of it, there is a fact that India is not included in the framework of Non-proliferation Treaty. Japan was reluctant to exporting nuclear plants to India, when Nuclear Suppliers Group exceptionally lifted the ban to India in 2008. Singh promised Abe that India would maintain the moratorium of nuclear test, the condition which Japan set for its export to India. Plant developers of Japan is worrying about Indian law to ask for the responsibility of plant makers, not only the operating company, in case of an accident.

In Japan, Nuclear Regulation Authority is setting new strict standard for resuming nuclear reactors. It is unlikely for developers to expect good deals inside Japan at least for next few decades. But it is questioned whether it would be morally correct that country which invited great disaster is exporting nuclear plants to other nations.

Both leaders also made a deal for joint research to introduce India the bullet train system already prevailing in Japan. Japan looks to lay the super railroad between Mumbai to Ahmedabad. Abe also offered governmental aid to the subway system in New Delhi and to Indian Institute of Technology Hyderabad. Singh welcomed all those offer in the way of multi-directed diplomacy.

Japan also exporting India the amphibious aircraft, US-2, as a symbol of bilateral security cooperation. In this deal, Japan intends to make India stay close to Japan rather than China. But, as shown in the previous meetings between premiers of India and China earlier this month, India is not taking one side in maintaining its security. Japan still needs to cultivate business ties to further develop relationship with growing India.

Victory Assured

The leading parties, the Liberal Democratic Party and New Komeito, agreed on the schedule for the election of the House of Councillors. The election will publicly be announced on July 4^th and voted on 21^st of the month. LDP seems to be winning, as a theoretical result of debilitation of other parties. Following the sweeping victory in the general election of the House of Representatives last winter, it is very likely for LDP and Komeito to get simple majority in the coming showdown, providing them a freehand for control in policy choices.

The Public Officers Election Act determines that the election of the House of Councillors should be held within thirty days before the term of its lawmakers expires. And if those thirty days overlaps with the session of the Diet or with twenty-three days after the session, the election has to be held within the period from twenty-four to thirty days after the end of the session. One half of lawmakers in the House of Coucillors will meet their term expiration on 28^th of July. The current session of the Diet will end on 26^th of June. Since leading parties agreed on not extending the Diet session, and with the practice of having every election on Sunday, the voting day of the election dropped on July 21^st.

Parties are going to compete over 121 seats, a half of all seats in the House, which consist of 48 seats for proportional representative and 73 seats elected from 47 districts. According to the polls and previous examples, it is likely for LDP to get around 18 seats in proportional representative, and 45 in district election. Adding to likely 11 seats for Komeito, the LDP-Komeito coalition can take 74 seats, 11 more than necessary seats for securing simple majority in the House.

In this estimate, the Democratic Party of Japan may get 25 seats, helped by organizational activities of labor union. Your Party is likely to get 8, while ailing Restoration Party of Japan limited to 5. Other parties will share the rest of the seats. Please note that all above are nothing more than writer’s personal guess.

Although LDP can secure simple majority in both Houses after the election, getting  two-thirds majority, necessary for the proposal of constitution amendment, in each House is unlikely. That will be still insufficient, even if it gets supports from Your Party and Restoration Party.

So, LDP will rather focus on conventional issues such as raising consumption tax rate, joining the negotiation over Trans-Pacific Partnership, or restoring relationship with China and South Korea. If PM Abe is going to insist on right wing issues, the politics in Japan will again go down into turmoil.

Yes, I Apologize, But…

It was as if perpetual motion of speaking for justifying himself. A co-leader of Japan Restoration Party, Toru Hashimoto, held a two-and-a-half-hour press conference at the Foreign Correspondent Club of Japan on Monday. Although he apologized his words to have recommended US Marine Commander in Okinawa to use sex business for restoring order in the troops, he rejected to withdraw his comment that recognized the necessity of comfort women in the wartime. Hashimoto again and again denied the involvement of Japanese government in abduction or human trafficking, only to further harm international relationship of Japan.

Hashimoto insisted that there were no coercion to comfort women, making an argument that this point was the most important issue for Korean people. But, it has actually been the discussion only for some eccentrically conservative politicians and bureaucrats in Japan. The argument in the world is that it is Japan that was responsible, regardless whether the government was directly involved in. Focusing on the responsibility of government is recognized as the justification of Japan, trying to take people’s eyes off of his wrong statement.

Hashimoto also reiterated that Japan should apologize for comfort women, with the acknowledgement of involvement of Japanese Imperial Army. About the Kono Statement which recognized Japan’s governmental involvement in comfort woman issue, he avoided denying it, while arguing that was insufficient in terms of lacking the viewpoint of official involvement. Once this argument gets into whether the involvement was official or not, it is regarded as a reviewing Japan’s apologies, making all argument invalid. He, as a political novice, did not know that.

Embarrassingly enough, Hashimoto began criticizing other countries, such as United States, United Kingdom, Germany, Korea or Soviet Union, as experienced the same wrong doings as comfort women. Obviously, he confused rapes with employing sex slaves. If a traffic violator complained with overlooking many other violators, police will not tolerate his violation. Similarly, Japan’s complaint of “Why they accuse only us?” does not make sense, as long as it diffuses mixed message to the world.

After all, Hashimoto was simply trying to survive in political scene as a young fresh dude by shifting his word from right to left, or reverse. “It is election when a politician takes his responsibility. If I had been wrong, our party will lose in next election. Then, there may be the time when my colleagues discuss about my stepping down,” said him. So, it will be the Japanese voters who are responsible for taking responsibility for the victim of comfort woman system.

Legacy Making in Burma

The biggest purpose would have been legacy making. The Prime Minister, Shinzo Abe, delivered a joint statement with the President of Myanmar, Thein Sein, which promised a certain amount of aid for the development in Myanmar. While expecting better economic relationship to back Abe’s growth strategy up, and effect of restricting Chinese expansion in Southeast Asia, Abe wanted to build a milestone for Japanese diplomacy toward Southeast Asia.

Abe’s grandfather, Nobusuke Kishi, visited Burma as the prime minister in 1957, and Abe’s father, Shintaro Abe, as the foreign minister, did it in 1983. This is the third time for Abe family to visit the country representing Japan. This family has been eager to develop the relationship with countries in Southeast Asia, sometimes putting higher priority than relationship with the Western countries. Shinzo, with his wife, has personally been involved in a project to build schools in Burma.

In the joint statement, Abe and Thein Sein declared to bring the bilateral relationship to a new higher one, hoping to build permanent friendship and cooperation. Toward that goal, Abe promised ¥91 billion overseas development aid to Myanmar, with cancellation of Myanmar’s debt of ¥200 billion to Japan. Japan will also help nation building effort in Myanmar and provide with human resource for the development.

Both countries will accelerate the process for signing on an agreement for investment, cooperating the development in the special economic zone of Thilawa. Japanese exporters look Myanmar as “the last resort” of Southeast Asia, and expected to contribute revitalization of Japanese economy. Abe thinks this country as one of the important keys to his growth strategy. To encourage investments to Myanmar, he led a great delegation consisted with a number of economic leaders in Japan.

Obviously, Abe has been looking for opportunities for tackling growing influence of China in that region. The joint statement also required the democratization of Myanmar in terms of rule of law, economic reform and reconciliation of the nation, making difference from Chinese developments. To assure security relationship, the statement included further dialogue over regional situation and security and cooperation between security officials.

The fact is, however, Japan is lagging far behind of China in Burmese development. It will not be easy for long-time socialist nation to change its mind to democracy. But, it is also the fact that this revisionist prime minister has few things to do in diplomacy, not having strong position toward US, South Korea and China.

Information Failure Again

There happened another leakage of radioactive materials in Japan. The facility that emitted them was not for power generation, but for scientific experiments. The amount of the emission was not so large as in the accident in the First Fukushima Nuclear Power Plant two years ago. This time, however, it took thirty hours for the facility to provide residents with the information of the accident. As its result, people in Japan became further skeptical about the nuclear community in Japan, even if nuclear technology is used for scientific purposes.

The accident happened in a laboratory for atomic nucleus and elementary particles in J-PARK, a facility for proton acceleration of the Japan Atomic Energy Agency, located in Tokai Village, Ibaraki prefecture, in the morning of Thursday. The experiment at the time was to hit proton beam on gold for producing elementary particles. Although alarm noticed the researchers of something unusual, they kept on the experiment. One and a half hours later, when the volume of radiation jumped up ten times higher than usual, the researchers stopped the experiment.

Then, they vented air in the room to reduce radiation level, emitting radioactive materials out of the facility. They inappropriately resumed the experiment and stopped it again with acknowledgement of high radiation thirty minutes later. After all, four researchers inhaled radioactive sodium, which was amounted to 1mSv, paralleled with annual exposition for ordinary people.

Although the total amount of emission was far less than Fukushima accident, the delay of informing process shocked the residents. The agency reported the accident to the Nuclear Regulation Authority one and a half day later. “We thought that estimated amount of exposition was lower than the regulatory line and that the contamination was limited inside the facility,” explained an official of the agency to the authority. But the leakage of radioactive materials exceeded the regulatory line. The government of Ibaraki prefecture decided to have detailed inspection in the facility.

The significance of this accident is the impact of “nuclearphobia” on scientific activities. As long as particle physics deals with nuclear materials, it is possible to invite a situation with more radioactive materials than usual level. But, people outside the nuclear community are highly sensitive about radioactive contamination. With dense population in small land, Japan does not have enough space to have experiments in isolated environment. Consequently, it is necessary for researchers to share detailed information about their daily activities. 

ID Number for All the People

The Diet of Japan passed the Common Number System Act, to introduce the similar system as social security number in the United States. To have a comprehensive identification number on all individuals has been long-time wish of the government of Japan since 1960s. The administration of Shinzo Abe, generally oppressive on ordinary people, finally succeeded in doing that. While people have a few merits from the system, the government can exercise broad power on people including taxation, collecting family information or censoring personal history on medical treatments.

The bill was submitted to the Diet at the time of DPJ administration. The reason at the time was that the system was necessary for collecting information of people to introduce the tax break system for low-income family when the consumption tax rate would be raised. Now, although that tax break system was determined to be invalid, Abe administration insisted on introducing common number system without showing specific reason. It was DPJ’s responsibility to let the act pass without any opposition.

Although the government has some number identification system such as drivers’ license, passport number, pension system number or health care system, there was not a comprehensive identification system for overall taxation. By introducing the common number system, it can obtain information about individual income or history of accepting social security services. According to Asahi Shimbun, there are ninety-three kinds of information the government can obtain with new act.

The Ministry of Finance is trying to use the number for finding illegal tax evasions. The Ministry of Health, Labor and Welfare expects that they would be able to avoid wrong receipt of pension money. But that kind of comprehensive number may cause crimes. It would be possible that one malicious man swindle aged people’s money by obtaining personal information through the number. In fact, there have been huge numbers of crime related to ill-obtained social security number in US every year.

The Japanese are not sensitive on relationship between taxation and democracy. As shown in the history of Britain when the people obtained Bill of Rights against imperial power in late seventeenth century, or in US Declaration of Independence from United Kingdom, democracy has been struggle against taxation. Japan has no history of fighting taxation in the context of democracy. The government takes taxation for granted as the duty of all people in Japan. But, as Abe administration is going to change the constitution to expand governmental power over the people, there will be a growing resistance against oppressive reform of governing systems.

Adjustment or Turning Point

Tokyo Stock Market became a roller coaster on Thursday. After Nikkei Average marked a rise of about ¥300 in the morning, it got down by ¥1,143 in the afternoon, making a record of decline in these thirteen years. Analysts were not sure about the reason of that strange move. Some recognized it as an emerging of negative aspect of the economic policy if Prime Minister, Shinzo Abe, others took it to be a temporary adjustment. The move at least calmed enthusiastic investors down to reality.

In the morning of Thursday, the stock price got up, while investors were acknowledging the steep rise of interest rate of long-term bonds. When the hitting seven-months low of Chinese purchasing managers index was reported before noon, foreign investors, which occupied sixty percent of total exchanges in Tokyo market, supposedly sold their holds. High-speed sell/buy system, which enabled one thousand exchanges a second, accelerated that quick shift in the market. Sudden rise of Japanese Yen in Tokyo Foreign Exchange also affected the down of stock price, different from recent tendency in which cheap yen and high stock prices were closely connected each other.

The strange move in stock exchange showed the vulnerability of Abenomics. While the stock prices had been showing all-time rise from when Abe took the seat, investors were accumulating skepticisms against Japanese economy, looking for an opportunity for selling stocks. The Bank of Japan is trying to inject ¥50 trillions in the market within a year. Everybody can imagine that kind of drastic remedy would invite distortion in market economy. Thursday was the day when that concern suddenly emerged.

Nikkei News denied the view that consecutive rally in the market was ended. It explained the tumbling down on Thursday as temporary adjustment, introducing the view of an economist who believed long-term credibility to economic policy and activities of companies, also indicating some ups and downs in next few weeks. The stock price regained power in Friday morning.

Policy makers of Abe administration showed intensive calmness about the market move. Ministers of the cabinet tried to show sobering face by saying “We don’t fluctuate between hope and despair about the move of market.” But they had been delighted to see the rally as a positive sign of Abenomics, saying “We have done that, DPJ could not do.” Media also are narrow-minded, explaining the market only from the perspective of Japanese economic policy. True reason of rising stock price in May was not because Abenomics, but positive tendency of US economy. Substantial measures for encouraging business and reducing national debt is really needed.

Abenomics Tendon

The Chairman of the Bank of Japan, Haruhiko Kuroda, on Wednesday admitted that the rate of long-term bonds, different from short-term bonds, could not be controlled. Although long-term bonds rate had been declining after Prime Minister, Shinzo Abe, inaugurated last December, it shifted to getting up after BoJ introduced the greatest monetary easing policy in early April. In the government possessing huge amount of deficit, long-term bonds rate is Achilles tendon of Abe’s economic policy.

The rate of interest for ten-year governmental bonds was raised from 0.315% on the day after new monetary policy was introduced to 0.920% on Wednesday when BoJ decided to maintain that policy at regular policy deciding meeting. In the morning of Thursday, the rate marked 1%, the highest rate in these seven months.

The reason is basically thought to be shift of money from bonds to stocks, following the positive effect of economic policy on stock market. But, it is recently worried that BoJ policy of buying large amount of national bonds has made investors negative in bonds market, and has encouraged private banks selling long-term bonds.

At the press conference after the meeting, Kuroda emphasized that the bank would be more careful in selling them. “We will review the way buying national debts and introduce flexible market operation. We can reduce the amount of buying debts by increasing the frequency,” told Kuroda.

Optimism and self-confident attitude has been diminished from Kuroda’s face. “We have to avoid excessive volatility,” he stressed in the conference. “It is not controllable like short-term bonds,” he also explained about uncontrollability of long-term bonds rate. He denied the perspectives worrying the impact of long-term bonds rate on real economics.

However, the rate of interest for housing loans has already been raised these months. Major private banks raised them by 0.05% at the beginning of May. More hike is expected next month. The more crucial is the impact on industries. Private banks are raising the interest rate of loans for industries. Companies are negative for delivering of debenture loans, because their higher interest rate may increase the cost. As the result, it is getting difficult for industries to procure money.

If this trend is connecting to the incredibility for national bonds, the rise of long-term bonds rate will be accelerated. As long as Abe administration is keeping its policy of positive finance causing more deficits, Abenomics will be annoyed by the possibility of great catastrophe.

Party of Discrimination

The Japan Restoration Party is spiraling down with consecutive misconducts of its leadership. Co-leader of the party, Toru Hashimoto, is still justifying his words recognizing the necessity of “comfort women” in World War II, costing cooperation with Your Party broken up. This fanatic group of political outsiders seems to be destined to disappear after the election of the House of Councillors this summer, leaving bitter taste in the history of Japanese politics.

Hashimoto’s effort to recover his failure has been outrageous. While apologizing his recommendation to take advantage of sex business for US soldiers in Okinawa, he rejected to regret to his justification of comfort woman. But, he told that he would apologize to comfort women, whether or not forced trafficking had happened, making contradiction with his former attitude that no apology was needed without forced trafficking. He resumed his daily appearance to the media, two days after when he declared to end that in frustration with reports against him. He anyway keeps on criticizing media of not telling truth.

Following Hashimoto, Shingo Nishimura, one of the lawmakers of the party, made an extremely discriminative statement. “There still are numerous Korean prostitutes in Japan,” said Nishimura at a meeting of the party legislators. The party deprived him of party membership. Another co-leader, Shintaro Ishihara, again showed his revisionist view on World War II. “McArthur testified in the Congress that the War of Pacific Ocean was for self-defense for Japan,” told Ishihara to support his idea denying aggressive aspect of Japan. But, different from Ishihara, Hashimoto has been approving the aggression of Japanese military at the war. It should be serious problem that co-leaders are saying totally different things over basic recognition of history.

Your Party, having similar view on governmental reform, decided to dissolve the partnership in the election with the Restoration Party. Although both parties were seeking to support candidate in each constituency, Your Party found it no good for them. “We take a distance from a group that hails war regime,” told Yoshimi Watanabe, the president of Your Party.

In the poll of Asahi Shimbun, the ratio of voters who are willing to vote to Restoration Party was 7%, diminished in half from the percentage in January. Because the popularity of the party was heavily dependent on Hashimoto’s personal character, his misstatement was fatal to the party.

Intimidation Under the Sea

Minister of Defense, Itsunori Onodera, on Monday told reporters that the ministry had identified the nationality of a submarine, which had cruised underwater in the contiguous zone of Japan. He added that the self-defense force collected information of the submarine in the way the object could realize that action. It was unusual for military to reveal counteractions against submarine. Without naming specific country, Onodera intended to appeal his effort against Chinese military intimidation.

According to the reports in Japan, the ministry had confirmed at least three submarines around the Nansei Islands. The first was at west of Amami-oshima Island on 2^nd of May, the second was at the west of the main island of Okinawa on 12^th and 13^th, and the third was at the east of Minami-daitoujima Island, outside of the First Islands Line, on 19^th. The government of Japan is warning that if it confirms a foreign submarine in the territory of Japan, the self-defense force will take maritime guarding action, according to the legislation for self-defense force.

The government of Japan is requesting self-restriction for the country those submarines affiliate. In the third case on 19^th, an antisubmarine patrol plane dropped a sonobuoy, the detector which diffused sound wave to the object to let the submarine know about Japan’s acknowledgement, according to the report of the Yomiuri Shimbun. Although passing contiguous zone is not a violation of international law, the officials of Ministry of Defense recognized that the only country which has capability and intention to pass that zone was China. The ministry and reporters shared the notion that those submarines were affiliated to China in don’t-ask-don’t-tell way.

If the submarine was from China, the purpose of the submarine supposedly was to show its presence against US Aircraft Career, Nimitz, which was deployed in the west sea area of Kyusyu Island for the joint exercise by Japan, US and South Korea. It is crucial for China to deny the access of US force and secure the naval control inside the First Islands Line. China seems to continue this type of demonstration of its presence in this sea area.

As North Korea sees US over the shoulder of South Korea, China sees US behind Japan. Even how the government of Japan warns China to stop intimidating action, there will be no consequence unless US is seriously taking on the issue. The diplomacy between US and China looks to be focusing mainly on the issue of North Korea’s nuclear and missile development. US government needs to make its policy clearer than ever on the dispute between Japan and China over territorial issues, including the matter of sovereignty.

New Energy Alternative

Generally, it was one of the good news for energy policy in Japan. The United States Department of Energy announced that it had approved the application of a project in Texas for exporting shale gas to Japan. It will be the first time for US to export shale gas to a country without a free trade agreement. The approval had a possibility that US shale gas might be sharing about twenty percent of liquefied natural gas supply in Japan. But its real impact is not clear.

The project is developing shale gas in Freeport, a city on the coastline of Gulf of Mexico. Joining the project, Chubu Electric Power and Osaka Gas is obtaining the right to buy the gas. There are two other similar projects ongoing in US. One is in Maryland with the cooperation of Sumitomo Corporation and Tokyo Gas, and another is in Louisiana with Mitsubishi Corporation and Mitsui & Co., Ltd. for supplying to Tokyo Electric Power Company. When all three projects are approved, shale gas will be a reliable source for energy supply in Japan.

The most fascinating element of US shale gas is its low price. While the average price of imported LNG in Japan has been $17 per a million British Thermal Unit, LNG in US cost only $4 last year. With the unavailability of nuclear power, the price of electricity in Japan is getting high these years. By using cheap US shale gas for thermal power generation, Japan can secure cheap energy that may lead to stable economic growth. Development Bank of Japan estimated that the imported LNG price could be cut by 15% by 2020, if US shale gas would be available.

Another merit for Japan is having competitiveness in energy procurement. About a half of imported LNG now comes from Australia, Malaysia and Qatar. With securing US shale gas, Japan may draw a better deals from those exporters. Russia already suffered from the shift of exports of Qatar from US to Europe. Japan might have good deal with Russia, which is looking for major importers of its natural gas.

It is, however, not clear how Japanese energy market will be flexible for accepting more LNG. Technology looks like making other energy sources obsolete. Hydroelectric generation costs very much to build facilities. Renewable energy is unreliable so far. Nuclear energy is too dangerous. But, Japanese energy structure highly dependent on nuclear power cannot allow LNG replace nuclear power generation. “Atomic Village,” a group of influential people who are involved in the development of nuclear energy in Japan, is too enthusiastic in resuming nuclear power plants to think about energy shift. It is necessary for expanding the possibility of shale gas to encourage political decision of lawmakers in Japan.

Solo Play on Abduction Issue

The discussion was about abduction issue, in which an unofficial envoy from Japan told North Korean official that Japan would take no action without any achievement on it. Isao Iijima, an adviser of the Prime Minister Shinzo Abe, returned from four-day stay in North Korea on Saturday. Details of his schedule there is still unspoken. But, it is obvious that he could make no actual deal on nuclear and missile issue, because the circumstance of the negotiation was strictly limited by concerted effort of The United States, China and South Korea, putting pressure on the North. So his achievement should be about bilateral issue between Japan and North Korea at most.

According to the news reports in Japan, Iijima had met with high-class officials including Kim Yong-nam, the president of the presidium of the Supreme People’s Assembly, and Kim Young-il, the director of international affairs in the Workers’ Party of Korea. Without meeting with the supreme leader, Kim Jong-un, the North treated Iijima with the highest protocol for an unofficial envoy. The seriousness for accepting Iijima sent a message to the world that the North was willing to have negotiation in various channels other than official governmental contacts.

The purpose and the result of Iijima’s visit are still unclear. Reportedly, he told the officials of the North that Japan would seek a comprehensive deal in issues on abduction, nuclear and missile development. On abduction, he asked the North of immediate returning back of abductees, developing the facts in abduction and transferring the suspects. The response of North Korean government was unknown.

Iijima also met with an official of the Workers’ Party of Korea, who was in charge of the General Association of Korean Residents in Japan. The association, working as North Korea’s representative office in Japan, is supposed to leave the building in Tokyo due to its huge amount of debt. Although it is a matter of contract between private sectors, the North supposedly asked Iijima to help the association stay in the building.

Even though the result was not revealed, the United States has shown certain frustration with Iijima’s visit. US Special Representative for North Korea Policy, Glyn Davies, left Tokyo a day before Iijima’s return home. Davies told the reporters before his leaving that North Korea was taking advantage of the difference of countries to separate them. From the view point of US, Japan might look like to be seeking unilateral benefit in the bilateral issue, ignoring the effort of other countries cooperating each other.

Abe said he would directly hear from Iijima about his trip, if necessary. The ultimate purpose of Abe should be making a deal on the abduction issue directly with Kim Jong-un. But, as long as the majority of countries are insisting on putting pressure on the North, Japan’s pivoting from pressure to dialogue would never work.

Details Needed

The goal was set. It is how to we would like to know, Mr. Prime Minister. PM Abe announced on Friday that he intended to double the income of farmers within next ten years. That was his second package of growth strategy, following the first one which focused on medical policies, as known as the most important in three arrows to implement Abenomics paralleled with monetary policies and budgetary policies. But farmers are still sober about his idea, because the policy of Abe administration is more worrisome than preferable.

“I will definitely make the strong agriculture on which young generation can rely,” said Abe at the speech in Tokyo. His “strategy” included expanding the market of production, processing and sales to the level of ten trillion yens in next ten years. He also promised that he would create “the bank for farmland integration” that encourages the liquidity of farmland by leasing the land to farmers operating a private firm. The government is setting an organization that is called “the headquarters of creating vitality of agriculture, forestry, fishery and local cities.” But encouraging private sectors and making new organizations in the government have been typical activity when bureaucrats were justifying themselves pretending to be doing something.

Farmers responded to the project with negative mind. According to the Hokkaido Shimbun, a newspaper in agricultural area, a lawmaker who are worried about the impact of Abe’s policy toward free trade, including joining the Trans-Pacific Partnership, said “Doubling the farmers income may be achieved by halving the number of farmers.” Doubling income was nothing new, because it was already introduced in the policy package of the Liberal Democratic Party for the election of the House of Councillors this summer. There is no budgetary endorsement for the policy, too. Considering those facts above, this agricultural strategy must be directed to attract voters in agriculture, who obtain crucial choice to win or lose in the election.

Abe also announced that he would raise the amount of capital investment to seventy trillion yens, the level before the Lehman Shock. To increase capital investment, he said he would make it easier for private lease firms to lend assets. But it was unclear that what kind of policy system would be created for that. Supposedly because of that opaqueness about future, Abe reiterated to encourage industries to invest positively, saying for example, “No action, no growth.”

Statistics showed that the gross domestic products increased in the first quarter of this year, while there was no sign of growth of capital investment. This was not only about the mind of managers of major industries, but about the guaranteeing enough budget and political stability. In terms of assuring them, the package was in half way.

Export-guided GDP

Reflecting the expectation to Abenomics, the gross domestic products of Japan in the first quarter of this year showed 3.5% growth after its annual adjustment. Although exports and individual consumption contributed the positive outcome, capital investment did not follow. The focus of economic policy would be converging into consumption tax hike.

Followed by cheap yen against US dollar, exports marked 3.8% growth from the previous quarter, October-December in 2012. Carmakers symbolically led the growth. Individual consumption, which occupied about sixty percent of GDP, enjoyed 0.9% of surplus. Although the wage had no indication of growth, consumers were optimistic about future economy, causing them to expend. Cars sold more and contracts for buying apartment houses increased. More consumers tended to have dinner at expensive restaurants and watches and accessories were popular in the department stores. Income from higher value of stocks encouraged those consumptions.

However, capital investment declined as well as former consecutive four quarters. During the time of high valued Japanese yen, companies moved their productive facilities to overseas. Not having firm belief of long-term growth, managers were restrictive in building new assets in Japan. They saw no sign of expansion of internal demands. Negative tendency of capital investment proved that money earned by companies had not been spent enough to revitalize whole economy.

Economists are watching how this temporary enthusiasm leads to long-term growth. To encourage more pay for workers and less unemployment, growth policy of Abe administration, which consists of the third “arrow” of Abenomics, plays crucial role. Although PM Shinzo Abe already announced his intention of encouraging medical industries and investments on technologies, companies are still skeptical. Injection of money to economy without distributive mind of employers may cause social division between the haves and the have-nots.

Moreover, the government is taking advantage of GDP growth for the reason of raising consumption tax rate in April 2014 and October 2015. Consumption tax generally has bigger impact on the people with less income than on the well-to-do. Higher commodity price, higher tax and low wage may let the ordinary people embrace political frustration over the Abe’s mishandling of economy. Abe therefore needs to show more reliable perspectives on mid- or long-term economy before the election of the House of Councillors this summer.

Unilateral Appeasement

Which would be worse, Hatoyama’s visit to Iran or Iijima’s visit to North Korea? An adviser to the Prime Minister, Isao Iijima, made a surprise visit to Pyongyang on Tuesday. During the visit, he plans to meet high officials of dictatorial regime led by Kim Jong-un. Officials of Japanese government, including PM Shinzo Abe, strangely shut their mouths about the visit, saying “No comment.” Considering the distasteful reaction of the United States and South Korea, the visit is supposedly a unilateral effort in the community against North Korea. This may erode Japan’s national interest.

After supporting PM Jun-ichiro Koizumi as a secretary for over thirty years, Iijima continued his political career taking advantage of his own relationship he had gotten in his close position to the Prime Minister. He is supposed to have close connection with some officials in North Korea, which was built in his experience to visit to Pyongyang in the delegation led by PM Koizumi. He is remembered as a secretary who distributed his friends a great amount of expensive matsutake mushroom gifted by the North then.

The government of Japan keeps silence. Diplomats in the Ministry of Foreign Affairs also do so, indicating the information of Iijima’s visit has been provided with from decision makers. The silence implies that the decision was carefully and readily made.

PM Abe on Wednesday revealed that he was willing to meet with Kim Jong-un to make a breakthrough in the abduction issue. For Abe, the abduction of Japanese citizens by North Korea is an important political asset, with which he consolidated his position as a hardliner against the North. But, he did not mention the relationship of his willingness with the visit of Iijima.

It is sure that Abe has been annoyed with diplomatic stalemate. He has no leverage to improve diplomatic ties with China and South Korea, both of which were deteriorated by his own action as a conservative freak. His attitude as a revisionist also made matters worse with the United States. The meeting with Russian President, Vladimir Putin, ended with no achievement in the most important issue, the Northern Territory. Abe might found North Korea as one of few friends of him.

Abe had learned nothing from Koizumi’s failure in the decision to visit Pyongyang without informing US. Iijima’s visit is accused by US, South Korea and supposedly China, the countries which are making concerted efforts to put pressure to the North. North Korea may use Japan’s approach for its own benefit. Isolation from the community is making Japan’s diplomatic standpoint weak.

Japanese Must Apologize

All Japanese may have to apologize to the world for letting him a leader of a national party. Toru Hashimoto, a co-president of Japan Restoration Party, said “Comfort women was necessary to maintain the order of the army at the time,” at a press conference. In addition, he recommended the Commander of US Marine in Okinawa to “take advantage of sex business.” Although there are arguments that he ignored dignity of woman or that he was eccentric revisionist, the most important point was he made a disaster for credibility of Japanese politics.

He tried to persuade people by saying “comfort women system had been common to all armies in the world.” But he confused prostitute with rape. Known raping case in the war may include Berlin fallen into the Russian Army at the end of World War II or Bosnia in the Civil War in Yugoslavia. Those cases happened as effusions of antagonism of occupiers against the subordinates. Comfort woman was forced organized prostitute in brothels built for the purpose. Most of those women were brought from non-enemy nation. That was a significant infringement of human rights.

Embarrassingly, Hashimoto tried to sell Japanese women to US soldiers in Okinawa. He ignored the words of a leader comprehended political will. That is not what political leader supposed to do. He also ignored the problem of LGBT in US military, only focusing men’s lust. So, what are you going to do for women soldiers or gays and lesbians, Mr. Hashimoto?

Colleagues of his party showed incompetence in responding to Hashimoto’s aggression of human dignity. Shintaro Ishihara, co-leader of the party and a well-known eccentric nationalist, supported Hashimoto by saying that military and prostitute had been having close relationship. Ichiro Matsui, General Secretary of the party, said, “Hashimoto meant that US soldiers could blow their energy off at bars with alcoholic drinks.” Matsui ignored how many US citizens restrict having alcohol with religious reasons. One who had seen US drunk man would do would not recommend them to have alcoholic drinks.

The obvious reason of Hashimoto’s excessive speech was to be looked at. His party has been declining in supporting rates and it is likely that they will be diminished after the election of the House of Councillors this summer. But, his sensationalism will face backlash from women voters. It is OK how soon they are gotten out of the stage of Japanese politics. It is the problem for us that our neighbor countries, including US, become more skeptical about Japan’s seriousness about recognition on wartime facts.

Waning on Amendment

The attitude of the Prime Minister Shinzo Abe on constitutional amendment is getting weak these weeks. On the amendment of the Article 96, which requires two-third votes of both Houses to propose an amendment, Abe said, “Asked if the national discussion about the amendment was matured, it isn’t.” Behind that, there is a regret about his attitude in his first term when he insisted on his own ideals. But, waning erodes credibility of a leader.

Answering an interview to Yomiuri Shimbun in mid-April, Abe unequivocally stated that he would make the Amendment of the Article 96 a campaign promise of the election in the House of Councillors this summer. He kept on saying, “It is strange that the constitution cannot be amended with a little over one-thirds of legislators’ denial, even if sixty or seventy percent of the people wanted it.” But, it is not strange for developed countries to require the two-thirds votes for constitutional amendment, instead of simple majority.

The biggest reason he began to restrain his appeals was his isolation. In the argument in the Liberal Democratic Party, there emerged an opinion that the amendment of Article 96 was not so important as Article 9 or other issues, and that shifting eyes from those crucial points was not fair. The friend party of the coalition, New Komeito, also criticized Abe’s standpoint to deal only with the Article 96 for the campaign promise. Supporters of Abe’s view consisted a minority group beyond party lines.

The criticisms are mainly based on constitutionalism, which determines the role of constitution as restricting power of government against people. To restrict the government of Japan to exercise excessive power, such as in the time of the World War II, the Constitution of Japan set a hard line for the amendment. Abe did not understand it. He thinks that the government should exercise great power to unite the people, and the people have to obey. This is not the mind of democracy, but autocracy. Knowing this idea as unfit for current regime in Japan, he is concealing his true intention.

What kind of message is he delivering to the voters in coming election? “Ok, I really want to change the provision of the constitution, though, I don’t do that this time. When should it be? I don’t know. It’s up to you guys,” would be the likely message from him. By the way, is that what the leader of Japan will ask the citizens? As long as he possesses evil ambition to destroy democracy in Japan, the amendment will not be achieved.

Limit of Wisdom

It will be the crucial blow to the nuclear fuel cycle project in Japan. The Nuclear Regulation Authority reportedly decided to order that the operation of the fast breeder reactor, Monju, in Tsuruga City, Fukui, should be indefinitely suspended. Since Monju has been recognized as the fundamental facility of nuclear fuel cycle, its unavailability means the end of the project. This poor country needs to review its greedy ambition over nuclear policy.

The construction of Monju, sodium-cooled nuclear reactor, started in 1986. In 1995, an accident of sodium leakage caused suspension of operation. At the time, lack of accountability for publishing information was broadly criticized. In 2010, right after resuming its operation, it stopped with another accident by dropping of devices for exchanging nuclear fuel into the reactor. The government of Japan already injected about one trillion yens to the program.

The direct reason of the authority’s decision was failing in required maintenance. At an uninformed examination last September, the authority found about ten thousand of machines that were not inspected. They included crucial machines for safety, such as sodium leakage detector, neutron detector and diesel generator for emergency. According to Asahi Shimbun, workers in Monju said they did not report about the lack of inspection, because they thought the machines had been had no problem. The administrator did not know about the sabotage. In short, they have not been inappropriate as the administrators of nuclear facility.

The failure of Monju will damage already highly skeptical nuclear fuel cycle project in Japan. The cycle requires the reprocessing plant of used nuclear fuel, the fuel making facility where uranium or plutonium produced by the plant is processed to MOX fuel, and the final disposal facility of high-level radioactive waste. All those are not completed so far.

The motivation of the cycle project is building a system of eternal use of energy, which is nothing but a dream. The significance of Monju was thought as producing more quantity of fuel than used fuel. From the viewpoint of ordinary people, the theory is irrelevant to basics of science. The scientists were too greedy to obtain convenient energy.

Monju was named after Manjusri, a bodhisattva of wisdom. The wisdom we got from the project of Monju was human wisdom was limited.

Great Regret

They performed a cheap opera for begging their lives. The Democratic Party of Japan held “a great regret meeting” on Saturday. The leaders of former DPJ administration kept on apologizing about their wrong handling of crucial events. What they regretted, however, was not what they had done, but how. Although moderate liberal power is needed to be an alternative to a revisionist regime based on excessive nationalism, it is unlikely for DPJ to take it over again unless the leaders really regret themselves to the extent of throwing their obsolete minds away.

They regretted how they handled the Great Northeast Japan Earthquake, the biggest event in their administration. “I regret to have spent a long time to take advantage of SPEEDI,” told then Prime Minister, Naoto Kan. He regretted his hesitation on using data of System for Prediction of Environmental Emergency Dose Information. “I am remorseful for not being able to integrate information,” followed Yukio Edano, the Chief Cabinet Secretary in Kan cabinet.

Publishing the information of SPEEDI delayed because of reluctance of bureaucrats who underestimated public rationality in emergency. But, information was also coming from other countries including the United States. The true reason Kan could not provide people in Fukushima with necessary information was his distrust of America, based on his resentment against US as a social activist. Even as a leader who was responsible for life and property of people, he could not abandon his own ideology. That was the fatal mistake DPJ administration committed.

They also regretted the handling of Futenma issue. Their conclusion was they needed to persuade people for their wrong decision to relocate the base outside Okinawa as soon as they realized it. But, the wrong decision they made was listing the removal of the base on their campaign promise in the general election in 2009. That also stemmed from their skepticism against Japan-US alliance. They also regret the wrong timing of the introduction of consumption tax hike. It was not about the timing, but about their ideology of big government.

It is obvious that they need to get rid of that old idea, if they want to rebuild the party. Too afraid of defeat at next election, DPJ is still, or ever more, dependant on the labor unions, which leaders are holding old Marxist ideology of recognizing themselves as vanguards of the proletariat. Labor unions do not represent the majority of workers, because they exploited workers by posing dues for incompetent leadership. To proceed on the main street of post-war democracy in Japan, DPJ has to say goodbye to the negative heritage of the twentieth century.

Who Welcomes Yen Decline

The biggest group in Japan that welcomes the decline of Japanese Yen against US dollar to the level of $1=¥100 would be math haters, because it’s easy for them to calculate exchanging rate. Nevertheless, the news reports focused on another group, the  exporters. Although this trend in foreign exchange is generally recognized as favorable result of Abenomics, more people are getting skeptical on this market-oriented economics. Negative aspect of the steep recovery is looming.

Japanese economic correspondents sometimes report only the positive side of economy. Most reports explained the reason of Yen’s decline as a consequence of bold monetary ease led by Prime Minister, Shinzo Abe, and the Chairman of the Bank of Japan, Haruhiko Kuroda. Although they actually made a momentum of this trend, recent moves of foreign exchange has been motivated not by the policies in Japan, but by the recovery in US economy. It is not Yen’s decline, but US Dollar’s hike.

The point now is how to maintain this rate. If US Dollar keeps on appreciating, the impact on importers in Japan will be devastating. Although both Abe and Kuroda are optimistic about their handling of monetary policy, Japan has no power for controlling US economy. Market may uncontrollably harm Japanese economy. Are they buying Japanese Yen, when the market heats up? The effect will be limited. It is false manipulation of foreign exchange, anyway.

Pressures from overseas are coming. Group of Seven meeting by financial ministers and monetary leaders, started on Friday, is expected to discuss foreign exchange. Frustrated by independent decline of Japanese Yen, G7 is going to reconfirm to avoid competitive cheap currency. It is unclear whether the parties accept Japan’s explanation that the monetary ease was aimed at domestic effect, not foreign exchange.

The rate of long-term debt is ominously getting high. Debt market in Tokyo sees a trend of investors to shift money from debt to stock. The Ministry of Finance reported on Friday that national financial debt hit a new record of ¥991 trillions at the end of FY 2012. Once national bond loses its credibility, it may follow the same course as Greece.

As long as stock market is rallying, people are optimistic about negative side of current economic policy. Increase of commodity prices, however, is steadily harming people’s lives. Although the government expects 2% hike of commodity prices, it does not include the impact by the rise of consumption tax rate, 3% next April and additional 2% on October 2015. Wage has no indication of rise so far. No exporter who welcomes this cheap Yen seen so far, except carmakers.